John Wooden’s greatest accomplishments weren’t limited to just basketball.  He was the mastermind behind the fundamental skills that turn any dream into a reality, a.k.a. the “Pyramid of Success.” Following Wooden’s lead, we have our own version of the retirement Pyramid of Success.  Most savers are probably looking for investment help, but what you should really determine first is, (1) if you are in a financial position to be investing, and (2) if so, the type of account in which you should invest.

The number-one priority for extra cash is paying off bad debts (for example, credit card debt), followed by establishing an adequate emergency fund, and then saving for retirement within your budget. After these items are addressed, then it is time to redirect your attention to (2).

So how can one determine the difference between good debt and bad debt?

Good debt should be considered as worthwhile purchases that will increase a person’s quality of life, especially an education since it’s something that will most likely lead to an increase in income over time.

Feeling bad over large debts like this is a waste of time since they happen quite frequently in life and are something worth investing in. But when debt isn’t purposeful, at times it can become a large problem. One of the worst ways to accumulate debt is the use of high-interest rate credit cards for everyday purchases. Being honest with oneself about what is attainable and manageable within a person’s finances will hopefully avoid many years of paying a minimum payment that only chips away at the balance. Therefore, understanding the difference between the two debts is vital to your present and future expenses.

After expenses are determined and there is extra cash left over, our focus can now be redirected to investing. Where to save for retirement might be confusing, given the number of factors to consider (account types, tax implications, employer contributions, etc.). If you are prepared to begin saving for retirement, the corresponding pyramid below provides the generally accepted order for where to put your next saved dollar.

About Jameson Van Houten:

Jameson Van Houten and his team recently joined Beacon Pointe Advisors in a 2021 acquisition, further expanding the Beacon Pointe presence in the Grand Canyon state and bringing another $430M to its growing AUM. As the founder and sole owner of Stonegate Capital Advisors, Jameson was brought on as a Beacon Pointe Partner and Managing Director – one of six in the Scottsdale area.

Jameson Van Houten has nearly twenty years of experience in the financial services industry. He founded Stonegate Capital Advisors in 2002 and built an impressive wealth advisory business based on deep roots and organic growth. Jameson leads an experienced and knowledgeable team serving a niche clientele base, not only in Arizona but also across numerous other states. The team’s specialties and services as Stonegate Capital Advisors included business, estate, and tax planning, as well as asset protection planning. Jameson and his team looked to merge with a larger firm like Beacon Pointe to expand upon the services they could offer their clients while also providing additional growth opportunities for employees.

Important Disclosure: The information contained in or linked to this post is for informational purposes only. It is neither intended nor should it be construed as investment, financial, tax, or legal advice. Beacon Pointe provides links for your convenience to other providers’ websites. Beacon Pointe is not responsible for errors or omissions in the material on third-party websites and does not necessarily approve or endorse the information provided.

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We get it. You haven’t created a budget because you had to go to your friend’s dog’s birthday party. Feel free to insert your additional excuses here. Living by a budget does not necessarily mean that you have to spend less. It’s about knowing where your money is going, and knowledge is power. Once you identify your money trail, you will know if you are staying true to your financial values.

One way to know if your spending habits are healthy is to see if they follow the simple 50-30-20 rule. This rule is a simple budgeting tool to track your spending and ensure that you not only know where your money is going but also to balance out the spending scale between needs and wants, while still saving for an emergency or for the future.

We’ll make it simple…

Watch the below video for an easy way to see if your spending habits are healthy.

1. Keep an eye on food prices. With inflation rates rising, the grocery store is one good place to implement your budget. Jameson asks, are there any non-essential items that can be removed from your grocery list without any difficulty? Any foods that are sitting in your fridge or pantry uneaten, that you can skip out on to avoid waste?
2. Keep your credit card debt low. Although it may be tempting to let your debt build up, Van Houten suggests paying off your balances entirely, if possible, to avoid any unnecessary card or interest rates.

To get more detail on Jameson Van Houten’s tips to start your sensible savings plan, visit the link below!

https://www.youtube.com/watch?v=VaPJA70qdNM&ab_channel=TED

About Jameson Van Houten:

Jameson Van Houten and his team recently joined Beacon Pointe Advisors in a 2021 acquisition, further expanding the Beacon Pointe presence in the Grand Canyon state and bringing another $430M to its growing AUM. As the founder and sole owner of Stonegate Capital Advisors, Jameson was brought on as a Beacon Pointe Partner and Managing Director – one of six in the Scottsdale area.

Jameson Van Houten has nearly twenty years of experience in the financial services industry. He founded Stonegate Capital Advisors in 2002 and built an impressive wealth advisory business based on deep roots and organic growth. Jameson leads an experienced and knowledgeable team serving a niche clientele base, not only in Arizona but also across numerous other states. The team’s specialties and services as Stonegate Capital Advisors included business, estate, and tax planning, as well as asset protection planning. Jameson and his team looked to merge with a larger firm like Beacon Pointe to expand upon the services they could offer their clients while also providing additional growth opportunities for employees.

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This acquisition deal with Jameson Van Houten and the Stonegate firm marks a busy and successful time in . It is the second established Beacon Pointe office in Scottsdale, Arizona.

Jameson Van Houten has nearly twenty years of experience in the financial services industry. He founded Stonegate Capital Advisors in 2002 and built an impressive wealth advisory business based on deep roots and organic growth. Jameson leads an experienced and knowledgeable team serving a niche clientele base, not only in Arizona but also across numerous other states. The team’s specialties and services as Stonegate Capital Advisors included business, estate, and tax planning, as well as asset protection planning. Jameson and his team looked to merge with a larger firm like Beacon Pointe to expand upon the services they could offer their clients while also providing additional growth opportunities for employees.

“Since our inception, we have always been focused on providing our clients with unparalleled service and expertise,” said Jameson Van Houten, Chief Executive Officer of Stonegate Capital Advisors. “Our partnership with Beacon Pointe allows us to bring in unique resources that enable us to evolve alongside our clients and meet the expectations of the increasingly dynamic and tech-focused world in which we live. We truly feel that through our partnership, we are elevating our services to the next level and going above and beyond what our clients have grown to expect from us.”

Jameson Van Houten discovered his passion for investing at the early age of 16. Jameson graduated summa cum laude from the Barrett Honors College of Arizona State University, where he was awarded ‘Most Outstanding Graduating Senior and Valedictorian’ from W.P. Carey School of Business.

Jameson holds the Certified Financial Planner™ (CFP®) designation and has received the Distinguished Alumni from Barrett, The Honors College, for his work both professionally and personally. Jameson is an active member of the local Scottsdale community and dedicates much of his time outside of work to his family and philanthropic efforts. Jameson is a past Governing Board Member of Make-A-Wish Arizona.

He is an Esteemed Member of Gift of Life, a non-profit dedicated to helping provide life-saving heart surgeries for children. Most recently, Jameson was appointed by the Mayor of Paradise Valley to serve as Chairman of the Board for the Paradise Valley Public Safety Retirement Plan.

“Jameson and his team are bringing their high energy to our amazingly talented and vibrant team in Arizona,” says Beacon Pointe Chief Executive Officer Shannon Eusey. “We are thrilled to partner with Jameson and his team, they share Beacon Pointe’s commitment to providing clients with a personalized and comprehensive approach to wealth management.”

The Stonegate acquisition closed on September 30, 2021; the financial terms of the deal were not disclosed. Including the Stonegate acquisition, Beacon Pointe has acquired approximately $8 billion in AUM through its acquisitions.

For additional details on the Stonegate Capital Advisors acquisition, please click here.

About Beacon Pointe:

Beacon Pointe Advisors is a multi-billion-dollar registered investment advisory headquartered in Newport Beach, California, with office locations and clients located nationally. Institutional and private clients have long relied on Beacon Pointe’s professional advisors to help determine investment goals, establish asset allocation guidelines, screen investment managers for selection, evaluate fund performance, and develop strategic financial plans through our proprietary allWEALTH® approach. Our advisors’ extensive expertise and strong commitment to our clients can be seen through numerous awards, including being recognized by Bloomberg, Forbes, Financial Advisor Magazine, CNBC, Barron’s, and more. For more information on Beacon Pointe’s wealth advisory services, please visit: www.beaconpointe.com.

Important Disclosure: The information contained in or linked to this post is for informational purposes only. It is neither intended nor should it be construed as investment, financial, tax, or legal advice. Beacon Pointe provides links for your convenience to other providers’ websites. Beacon Pointe is not responsible for errors or omissions in the material on third-party websites and does not necessarily approve or endorse the information provided.

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In honor of National Identify Theft Awareness month, we would like to remind you that how you look on paper does matter.  Lenders, insurers and employers are all checking out your credit, so here are our top tips to make sure you’re putting your best financial self forward.

Take a Look. Recognize Yourself? Take ten minutes and log on to annualcreditreport.com to review your free report from each of the major credit reporting agencies (Equifax, Experian and TransUnion).  While the free version won’t get you your actual score, the report may reveal damaging errors or potential fraud.  If you find an error, first, take a deep breath and put your patience pants on.  Next, write a dispute letter to the reporting creditor and notify all three reporting agencies (in writing) of your dispute. You may also need to notify other agencies like your bank or investment firm, the IRS or the Social Security Administration if you have fallen victim to identify theft.  For more information and guidance, we recommend myFICO.com.

Keep a Good Image: Ultimately, how good you look from a credit standpoint is “graded” by your FICO score.  Each major reporting agency has a different formula so your score will vary from one to the other.  Guess you could say that credit beauty is in the eye of the reporter!  Fortunately, the factors affecting your credit are consistent and there are steps you can take to improve your score with all three agencies. Generally, your score is weighted as follows:

• 35%– payment history (the timelier the better)
• 30%– amount of debt you owe (less is more)
• 15%– length of credit history (the longer the better)
• 10%– new credit inquiries (less is more)
• 10%– ability to manage different types of credit (mortgage, credit card, etc.) (it’s complicated)

Our advice to looking your credit best is to pay every bill on time, pay off your credit cards monthly and avoid charging more than 1/3 of your available credit limit.   You’ll also want to avoid opening too many cards and steer clear of tempting 0% store financing plans which are viewed as “credit of last resort.”

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1. A person or entity that owes a heightened sense of responsibility to another.  On with an ethical and, in some cases, legal responsibility to put another’s best interests above their own.  Examples include attorney to client, trustee to beneficiary and investment advisor to client.

a) A Suitability

b) A Fiduciary

c) A Friend

2. An investment approach that analyzes businesses rather than focusing on an industry or the economy.  An investor using this approach will analyze a company’s financial statements, products and services, management, competitive advantages and other factors that may affect performance.

a) Bottom-Up Investing

b) Company-Based Investing

c) Boutique Investing

3. A hypothetical set of individual stocks, bonds or other investment types used as a reference for a similarly invested portfolio’s performance.

a) ETF

b) Index

c )Mutual Fund

4. Often added to homeowners or renter’s insurance, a provision that provides additional coverage for certain items that are worth more than the per-item limit in the policy. Common items that are scheduled in this way include jewelry, art and antiques.

a) Insurance Add-on

b) Property Rider

c) Specialty Items Premium

5. Used to determine the affordability of a home, based on pre-tax income.  It is determined by dividing the annual cost of a home – including principal, interest, property taxes, insurance and association fees – by annual pre-tax income.  Financial planners generally recommend 28% or lower.

a) Housing Ratio

b) Loan Ratio

c) PE Ratio

6. A legal process in which a court determines the validity of a deceased person’s will.  It also includes the administration of a deceased person’s estate by the appointed executor (named in the will) or an administrator (named by the court in absence of a will).  Estate administration includes collecting assets, paying liabilities and taxes and distributing property to heirs.

a) Living Trust

b) Power of Attorney

c) Probate

7. The tendency for people to let others impair independent decision making. When thinking in this way, investment decisions are based on the thoughts and actions of other investors, which results in a gravitation toward the same investments. The psychology stems from fear of missing out on what others are doing.

a) Bull Mentality

b) Herd Mentality

c) Risk Averse Mentality

8. A term used to describe the tax treatment of certain expenses or savings plan contributions.  Amounts spent on allowable expenses or contributed to certain retirement plans may reduce the amount of income subject to taxation.  Common expenses include mortgage interest and property taxes paid.  Popular retirement plan contributions include those made to 401(k) plans and traditional IRAs.

a) Tax allowable

b) Tax deductible

c) Tax exemption

9. The return of an investment or portfolio, expressed as an average per-year return.

a) Portfolio gains

b) Beta

c) Annualized returns

10. A charitable giving vehicle that allows donors to manage donations to desired charities.  Donations are tax-deductible (for taxpayers that itemize) and await instruction from the donor on when to grant the money to charity.  Think of this as a pass-through charity that allows a current-year income tax deduction and donations at the discretion of the donor.  Funds are invested and have the potential to grow tax-free while donors are deciding on which charities to support.

a) Donor-Advised Fund

b) 501(c)(3) stock

c) Charity Fund

Answers: 1(b), 2(a), 3(b), 4(b), 5(a), 6(c), 7(b), 8(b), 9(c), 10 (a)

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We’ll make it simple…

Watch the below video for an easy way to see if your spending habits are healthy.

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If you sell an asset for more than you paid for it, you will realize a capital gain. If you sell it for less than what you paid, you will realize a capital loss. The operative word here is sell. There will be no tax on your assets appreciating in value, until you sell them.  Seems simple, right? But wait, there’s more…

Capital gains and losses are classified as long-term or short-term. If you hold an asset for more than one year before selling it, the capital gain or loss is long term. If your holding period is one year or less, the gain or loss is short-term. This categorization matters for tax purposes. Gains realized on assets held for more than a year are taxed at lower rates than short-term assets.

To determine your gain or loss in a given year, know that gains and losses in the same year are netted against each other. For example, assume that you make the following transactions in a year; Sold stock A for a long-term gain of $100; sold bond B for a short-term gain of $25; sold mutual fund C for a short-term loss of -$100; sold ETF D for a long-term gain of $500. To determine your net capital gain or loss for the year, start by grouping the types together.  In this example, the initial result is a long-term capital gain of $600 and a short-term capital loss of -$75. Subtract the loss from the gain and your final result is a net, long-term, capital gain of $525.

The tax rate schedule for long-term capital gains is different from that of ordinary income.  For most taxpayers, the tax rate applied to long-term gains will be between 0% and 15%. In 2018, the maximum, long-term capital gain tax rate is 23.8%. Compared to the maximum income tax rate of 39.6%, you can see the preferential tax treatment given to long-term investments. Short-term capital gains, on the other hand, are considered ordinary income for tax purposes and are taxed as such.

Once a capital gain is realized and the appropriate amount of tax is paid, you can mostly consider it a wrap. Capital losses, however, linger for tax purposes, which is a good thing. Capital losses that exceed gains in a given year can be used to offset income and future gains. The IRS allows you to use $3,000 of this loss to reduce ordinary income for the year and any remaining losses can be used to offset future gains in years to come.

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Just because you have more cash, doesn’t mean you can afford to spend it. When attempting to stretch your hard-earned money across competing financial priorities such as buying a home, traveling, childcare, college, and retirement, we encourage you to define affordability not by cash flows, but in light of other goals, instead. Perhaps your cash flow says you can afford that trip to Italy but your retirement goal says you should travel less. Remember that the lifestyle you create during your working years is the lifestyle you will eventually have to self-fund from savings in retirement.

Work with a financial advisor who can help you understand what is needed to achieve your financial goals and to help you prioritize. We consider a healthy lifestyle one that allows you to save 15-20% of your take-home pay. So, start there. The next time you get a raise or bonus, direct the extra funds to your retirement plan or savings account. Check with your HR Department to see if there is an option to automatically increase your savings and/or retirement plan contributions on an annual basis – if you can’t see it, you won’t miss it! The easiest way to save more is to never get used to having the extra cash. Take control of your standard of living and don’t let an expensive lifestyle creep up on you.

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The number-one priority for extra cash is paying off bad debts (for example, credit card debt), followed by establishing an adequate emergency fund, and then saving for retirement. Where to save for retirement might be confusing, given the number of factors to consider (account types, tax implications, employer contributions, etc.). If you are prepared to begin saving for retirement, the corresponding pyramid provides the generally accepted order for where to put your next saved dollar.

PSSSSSST! Protip: Your company match is just that—a match. If your contributions from each paycheck reach the annual IRS limit before the end of the year, your employer might stop your paycheck contributions. And, you guessed it . . . no contributions by you could mean no match by your employer, and income earned for the balance of the year could go unmatched. If you expect to max out in a year, contribute a set dollar amount from each paycheck versus a percentage of your pay to ensure that you don’t max out early and miss out. Check with your Human Resources department to see if it offers a “true-up” contribution at the end of the year to fix this common oversight.

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